India Plans Integrated CBG Policy To Cut Natural Gas Imports

The Government of India is preparing an integrated policy framework aimed at increasing compressed biogas (CBG) production and reducing dependence on imported natural gas, according to news reports. India imported natural gas worth more than $28.5 billion over the last 2 financial years, with imports meeting nearly half of the country’s requirements.

The proposed measures are expected to support domestic biogas capacity and encourage wider adoption across states. The existing GOBARdhan scheme is likely to serve as the foundation of the new policy approach.

India Plans New CBG Policy To Reduce Natural Gas Imports

The proposed integrated policy is designed to strengthen domestic production of compressed biogas and improve energy self-sufficiency. The initiative comes as India continues to rely significantly on imported natural gas to meet demand.

Speaking on July 2, Alok Tripathi, Joint Secretary at the Ministry of Petroleum and Natural Gas, said states would be financially incentivised for policy interventions related to CBG. The move is expected to align state-level initiatives with the Centre’s objective of expanding renewable fuel production.

SASCI Incentives for States to Boost CBG Production

The policy is expected to leverage the Special Assistance to States for Capital Investment (SASCI) programme. Under SASCI, the Union government provides 50-year interest-free loans to states for capital expenditure projects.

States adopting model CBG schemes and introducing supportive policy measures may become eligible for financial assistance under the programme. Such incentives could encourage greater investment in biogas infrastructure and accelerate project implementation.

GOBARdhan Scheme Remains Central to CBG Expansion

Launched in 2018 under the Swachh Bharat Mission, the GOBARdhan scheme was created to promote the conversion of cattle dung, agricultural residue and kitchen waste into biogas and bio-slurry. The programme aims to support renewable energy generation, improve sanitation and strengthen the circular economy in rural India.

It set a target of producing 15 million tonnes of CBG through various incentives and support mechanisms. The integrated policy is expected to build upon this existing framework rather than introduce a completely new programme.

CBG Plant Progress and Budget Support Measures

Data shared on the sector indicates that progress has been slower than initially anticipated. According to the available figures, 1,865 CBG/Bio-CNG plants have been registered, while only 210 have been commissioned.

Another 336 plants are under construction, whereas 1,319 projects are yet to begin construction. In the latest Union Budget, the government exempted CBG blended into CNG from excise duty, reducing the tax burden from 14% to 0% and potentially supporting demand for blended fuel.

Read More: India’s Manufacturing PMI Falls To 54.2 In June Amid Softer Demand.

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Conclusion

The proposed integrated CBG policy reflects India’s efforts to increase domestic energy production and reduce reliance on imported natural gas. By combining financial incentives for states with the existing GOBARdhan framework, the government aims to encourage faster development of biogas infrastructure.

Current project data suggests significant capacity remains in the pipeline, with many registered plants yet to become operational. The policy, if implemented, could play a role in supporting renewable fuel production and expanding the country’s bioenergy ecosystem.

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